Inflation at the Grocery Store

 I contributed to a Twitter thread the other day on the subject of grocery price inflation, and several hours later received a direct message from a reporter working on a story about the same topic, who asked if I would be willing to answer a few questions about our grocery spending. 

I'm always game to talk prices, since pricing is what I do professionally, and I discovered that our credit card company has much improved in their automatic categorization of purchases, so to check my subjective impressions I downloaded two years worth of our spending data and looked at how our weekly grocery spending has changed since inflation increased about a year ago.

The overall results surprised me. I was correct in thinking that we average a but under $400/wk in groceries, but it turns out this has been pretty consistent for the last two years. Over the last five years our average weekly grocery spending has increased only $14 from $345 to $359.  That's just a 4% increase, significantly less than inflation.

I'd included spending on eating out and gas on the theory that we might be balancing greater grocery spending by cutting other weekly spending, but those dont' seem to have changed much either.

So despite costs going up across the board, we seem to have been pretty successful in not actually paying more for groceries ourselves.

One explanation for this is that I now do more price shopping between stores. Back in early 2021 I was doing almost 70% of our shopping at Kroger.  By the end of 2022 that had fallen to less than 50%, and the share of our spending at Aldi (which generally has lower prices) had shifted from about 15% to over 30%.

We'd also made some fairly conscious choices as prices increased:

• We ended our canned seltzer habit, something of which we'd been buying three 12-packs a week prior to the cost of gas (and other inflation, but transportation costs are always a major part of the cost of cheap liquids)
• We mostly stopped eating beef, shifting first to chicken and then increasingly to pork. Pork loins are the meat you can still get consistently for close to $2/lb
• We reduced egg consumption as eggs quadrupled in price over the last few months

However, we also made a number of other minor trade offs, some of which I'd probably have to think quite a bit about, in order to keep our food spending at what seemed like a reasonable level. Even knowing that consumer behavior data usually knows that people are very good at making trade-offs without even realizing it, I'm impressed with how consistent our spending data is over the long term.